Manage Supplier Risk - Drive Superior Supplier Quality Outcomes (CEB Webinar)

CEB Quality Leadership Council

Drive Superior Supplier Quality Outcomes

19 May 2015

A Framework for Member Conversations

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© 2015 CEB. All rights reserved. QUAL2565215SYN

ROADMAP FOR THE PRESENTATION

Measure Supplier PerformanceIntroduction Improve Suppliers Next Steps and Q&A

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Revenue Expectations Cost Pressure0%

50%

100%

2%6%10%

15%

41%

19%

7%

1%4%8%

20%

43%

18%

6%

DERF 13-4684

Catalog # FLC6674813SYN

Title BRF: Bus Barometer Q3 Ex Summary

INTENSE PRESSURES DESPITE SUPPLY RISKS

Business Executive Expectations of Revenue Growth and Cost Pressure in Next 12 MonthsQ4 2014 Business Barometer Survey

Business Executive Expectations of Supply Chain Disruptions in Next 12 MonthsQ4 2014 Business Barometer Survey

Much Higher

Higher

Somewhat Higher

No Change

Somewhat Lower

Lower

Much Lower

Decreased

Same

Increased

Supply Chain Disruption0%

50%

100%

35%

56%

9%

n = 332.Source: CEB 2014 Business Barometer Survey.

n = 1,938.Source: CEB 2014 Business Barometer Survey.

Companies expect to fuel growth through increased efficiencies as cost pressures remain.

■ However, few expect supply chain risks to change over the next 12 months.

■ This pressure to perform, while containing costs, can lead to an unintentional oversight of key risk assessment and reduction strategies.

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DERF 13-5292

Catalog # QUAL7015613SYN

Title HO: Santa Clara 10 02 Sr Advise

INSUFFICIENT SUPPLIER OVERSIGHT INCREASES COSTS

Estimated Costs Incurred by Accelerator Pedal and Floor Mat RecallsToyota Motor Corporation, in Billions of US Dollars

Product recall and repair costs

Estimated lost sales. The recall is estimated to have dented demand by 10,000 vehicles.

National Highway Traffic Safety Administration fines for not notifying the agency in a timely manner of problems.

Settlement costs related to complaints of unintended acceleration.

$1.1 $0.8 $0.08 $1.10

Source: Tomoko A. Hosaka, “Toyota Recalls May Cost Automaker $5.5 Billion.” NBCNews.com, 10 March 2013, www.nbcnews.com/id/35893905/ns/business-autos/t/toyota-recalls-may-cost-automaker-billion; Mike Ramsey, “Toyota in $5.5 Billion Gas Pedal Settlement,” The Wallstreet Journal, 27 December 2013, https://online.wsj.com/article/SB10001424127887324669104578203440990704994.html.

Insufficient supplier oversight has overt costs that impact profitability.

■ Toyota’s 2009 recalls for accelerator pedals and floor mats cost the company an estimated $3 billion.

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BUILD SUPPLIER QUALITY MANAGEMENT CAPABILITIES

Supplier Quality Management Maturity Curve

■ Led by Procurement

■ Ad hoc program

■ Led by Quality ■ Introduces supplier self-assessments

■ Uses on-site audits occasionally

■ Limits supplier development

■ Uses standard qualification and auditing process

■ Establishes standard criteria to identify supplier performance issues

■ Prioritizes supplier development activities

■ Measures supplier performance

■ Uses supplier risk profiles

■ Audits for strategic management criteria

■ Develops suppliers on strategic activities

■ Establishes a shared risk prioritization framework with procurement

■ Integrates activities into corporate risk and audit programs

■ Assesses and audits for culture and corporate management practices

■ Uses supplier performance to inform business continuity planning and customer experience risk assessments

Basic Emerging Intermediate Advanced World-Class

Source: CEB analysis.

DERF 13-5878

Catalog # QUAL7384013SYN

Title ST: AandE Supplier Risk

Quality organizations move through five levels of maturity as they strive for world-class supplier quality management.

■ Supplier quality management often begins as a procurement-led activity, but at world-class companies it eventually integrates with other assurance activities related to corporate risk.

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THE CURRENT STATE OF SUPPLIER PERFORMANCE MEASUREMENT

“Measure Supplier Performance” Importance Versus Maturity ScoreAverage Score

Quality executives recognize the importance of measuring supplier performance, but maturity lags.

■ Measure Supplier Performance: Approaches used to measure the performance of existing suppliers.

Level 1 Level 2 Level 3 Level 4 Level 5

Quality measures supplier performance locally according to incoming inspections and quality issues.

Quality measures supplier performance locally according to their ability to consistently deliver products that meet product specifications.

Quality uses a single consistent framework for measuring supplier performance to assess a supplier’s ability to meet several operational expectations.

Quality provides supplier performance inputs to an integrated supplier scorecard that is used globally to track and compare supplier performance across all elements of the relationship.

Supplier performance reports are integrated into corporate risk reports and inform business continuity planning and customer loyalty risk assessments.

n = 24.Source: CEB Quality 2014 Functional Maturity Diagnostic.

Importance Maturity

3.38

2.55

Very Important

Project # xxxxxx

Catalog # PSC8151514SYN

5.0

4.0

3.0

2.0

1.0

0.0

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INTEGRATED SCORECARD DEVELOPMENT BEST PRACTICES

Principles Benefits

Involve internal business partners before developing scorecard.

Demonstrates how scorecard focuses on elements business partners care about (i.e., metrics beyond quality).

Create category-based scorecards.Enables analysis of similar suppliers in an apples-to-apples fashion.

Focus on the “critical few” KPIs (approximately three to five per metric).

Maintains focus on the most important drivers of supplier performance.

Select KPIs that are within the organization’s control.

Measures outcomes that can be influenced by the organization and the supplier.

Use a mix of both quantitative and qualitative KPIs.Contributes to a fact-based scorecard while allowing for day-to-day user perception.

Incorporate existing KPIs and/or SLAs where appropriate.

Encourages adherence to existing contract terms and conditions.

Automate data collection, aggregation, and reporting.

Creates a scalable performance management process.


Project # xxxxxx


Use a standardized supplier scorecard effectively manage suppliers.

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DEVELOP SCORECARD WITH BUSINESS PARTNER INPUT

Participants

■ Share opinions

■ Help determine criteria for supplier key performance indicators

Administrator

Organizes the meetings

Takes notes and distributes to all participants

Facilitator

Creates meeting agenda

Keeps participants focused on meeting goals

Drives decision making process

Sponsor

Ensures proper people attend the workshop

Ensures performance criteria meet overarching business objectives



Project # xxxxxx


Ask probing questions to surface business partners’ performance expectations for a category of suppliers, such as:

■ What equates to satisfactory performance for suppliers in this category? ■ If we hired a new supplier today, how could they make an immediate positive impact? What defines a negative impact?

■ Are there any existing measurements you are tracking that define supplier success in this category (i.e., SLAs, other pre-defined expectations)?

■ What causes you heartache with suppliers in this category? ■ What aspects of your supplier interactions should be measured in a scorecard? ■ What do high performing suppliers in this category do that lower performing suppliers don’t? ■ When you come across situations where a supplier can improve, what typically causes you to think that?

Use a workshop to get business partner input to scorecard development.

■ Include both Quality staff and business partners with knowledge of the supplier relationships.

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SCORECARD STRUCTURE: METRICSQuality provides inputs to a standard, integrated supplier scorecard.

■ The sample scorecard uses six standard metrics designed to answer the following questions.

■ Cost: Is the expected value being received?

■ Delivery and Support: How reliable is the supplier? Do they meet established time frames?

■ Flexibility and Ease of Doing Business: How “well run” is the supplier? Is billing accurate?

■ Quality: Does product and service meet expectations?

■ Partnership: Is the supplier proactive? Do they provide strategic guidance?

■ Risk and Compliance: Does the supplier mitigate risk? Do they comply with company standards?

Metric Metric Weight Percentage KPI KPI Measurement

Cost 30%

Price Competitiveness Ranking compared to competitors

Discounts and Value-AddSupplier proactively identifies volume discounts and other price-reducing options

Transparency in Negotiations Provides transparency into its cost breakdowns

Delivery and

Support25%

Problem ResolutionSupplier is willing to take ownership of day-to-day issues and problems

On-Time Delivery Degree to which hardware orders are delivered on time

Service Dependability Degree to which hardware service calls are completed on time

Order Accuracy Degree to which supplier fills orders accurately

Flexibility and Ease of Doing Business

10%

Invoice Accuracy Degree to which supplier provides error-free invoices

Invoice Timeliness Invoices are provided in a timely manner

Account Management Responsiveness

Supplier’s account management team quickly responds to requests

Usefulness of ReportingReports contain clear, concise, and actionable information including performance, financial performance data, or trend information as appropriate

Order ModificationsSupplier is able to accommodate order changes without significant impact from delays

Quality 20%

Quality of Product Quality of product against requirements

Mean Time to Repair (MTTR) MTTR statistics against requirements

Reliability Mean time between failures against expectations

Warranty/Maintenance Number of warranty claims and defects

Resource Quality Ability of resources to install and/or repair hardware based on contractual obligations

Partnership 10%

Provision of Innovative Solutions Proactive provision of valuable and innovative solutions

Business AlignmentSupplier’s recommendations reflect their understanding of our business objectives

Technology Supplier uses leading-edge technology in its products

Risk and Compliance

5%Product Safety Products function in accordance with industry safety standards

Business Alignment Supplier supports our diversity goals


Project # xxxxxx


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MetricMetric Weight

PercentageKPI KPI Measurement

Quality 20%



ReliabilityMean time between failures against expectations

Warranty/Maintenance Number of warranty claims/defects

Resource QualityAbility of resources to install and/or repair hardware based on contractual obligations

SCORECARD STRUCTURE: KEY PERFORMANCE INDICATORS (KPIs)

KPI Evaluation Criteria

If a KPI is effective, you should be able to answer “yes” to many of the following questions:

■ Does it align with business objectives?

■ Is it actionable?

■ Is it quantitative and objective?

■ Is it contractual?

■ Is it well defined, including rating system?

■ Is it controllable?

■ Will it drive desired behavior?

■ Is reliable data reasonably efficient to obtain?


Project # xxxxxx


Identify three to five critical few KPIs per metric.

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MetricMetric Weight

PercentageKPI KPI Measurement

Quality 20%



ReliabilityMean time between failures against expectations

Warranty/Maintenance Number of warranty claims/defects

Resource QualityAbility of resources to install and/or repair hardware based on contractual obligations

SCORECARD STRUCTURE: KPI MEASUREMENTS

KPI Measurement Considerations

Consider the following questions when selecting KPI measurements:

■ What am I trying to measure?

■ Who can provide this data?

■ How often does the data change?

■ Who or what is the data source?


Project # xxxxxx


Define standard KPI measurement criteria for clarity across the organization.

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PANELIST

Simone SilvaDirector of Quality North AmericaWhirlpool Corporation

Simone Silva is currently the Director of Quality for Whirlpool in North America. Simone is responsible for the definition of the strategy for supplier development in North America and its execution, leading a team of approximately 60 people working with 1400 suppliers and supporting the 12 plants of Whirlpool in the US and in Mexico.

Simone has over 18 years of experience in Quality and Service, 11 years in Automotive and 7 years at Whirlpool Corporation, having had important international assignments in China, Germany and Mexico.

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SUPPLIER QUALITY RISK RATING DEFINITION AND APPLICATION

Before

■ No standardized quality metric across different regions

■ All available metrics were single focused, PPM, A-Defect, field, warranty cost

■ Multiple KPIs used by different stakeholders to assess supplier quality

■ No assessment of supplier competencies to support quality

■ As a result quality not consistently considered as a factor in business decisions

After

■ Balanced criteria for supplier quality assessment composed by performance and competence metrics

■ Stakeholder alignment on single criteria

■ Standardized criteria used to assess global suppliers in different marketing regions

■ Supplier risk rating used to prioritize training and supplier development initiatives

■ Supplier risk rating used as the single source of quality input for supplier selection

February March April May June July August

Supplier Risk Rating—Definition/Alignment

Execution—Use of Risk Rating (New Launches and Existing Products)

SDE PDPs SDE On-Boarding Supplier Training

Whirlpool Quality VisionUndisputed Quality Leader: Recognizably the Best, and Differentiated Versus Competition

Global Strategic Sourcing MissionQuality Parts and Services, Sourced and Delivered on Time, from theRight Supplier, at the Right Cost

Source: Whirlpool Corporation.

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THE TOOL—SUPPLIER QUALITY RISK RATING

■ Assessment performed by the SDE responsible for the Commodity on the corresponding market region

■ Criteria for scoring defined for each individual metric

■ Hard metrics from the corporate data systems, SAP, ONTRAC

■ Cross-functional collaboration encouraged for the competence assessment

■ Risk rating available to all functions interacting with suppliers on a web-based system


Scoring for Associated Risk

Risk Scoring Range

Low RiskTotal score between 80 to 100 points is considered Low Risk

Medium RiskTotal score between 60 to 79 points

is considered Medium Risk

High RiskTotal score below 60 points is

considered High Risk

70 points of scoring for associated Risk

30 points of scoring for associated Risk

SUPPLIER PERFORMANCE SUPPLIER CAPABILITYQUALITY RISK ASSESSMENT

Contribution to Total Regional

PPM

Total Regional CAL Occurrence

Sir/Field Failures Last 12

MonthsPPM Trend CAL Trend 8D

W-PPAP FPY

Process FMEA

FSARisk

ValueRisk

9 0.03% 7 3 12 N 0 11,299 6 5 9 3 4 2 52High Risk

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QUALITY RISK SCORING

Supplier Performance

RiskContribution to TOT

Regional PPMTOT Regional CAL

OccurrencesSIR/Field Failures

Last 12 MonthsPPM Trend CAL Trend

Contribution to PPM <.1% and PPM <150:

PPM 0 = 10 pts

PPM <.05% = 9 pts

PPM .05–.1% = 8 pts

CAL<1 Occurrences

CAL 0 = 10 pts

CAL 1 = 8 pts

No (FF) Field Failures in the last 12 month:

0 Field Failures and 0 CAL = 14 pts

0 Field Failures and CAL>0 = 12 pts

Supplier PPM <150

Trends down on 6 and 3 months rolling PPM with >40% imp = 18 pts



Suppliers under 50 PPM automatically get full 18 points

Trends down on 6 and 3 months rolling with >40% imp = 18 pts



Suppliers with 1 or less CAL automatically get full 18 points

Contribution to PPM <..4% and PPM <500:

PPM .11–.2% = 7 pts

PPM .21–.4% = 6 pts

CAL <6 Occurrences

CAL 2–3 = 7 pts

CAL 4–6 = 6 pts

Field failures (FF) in last 12 month with minimal effect to customer due to timely and robust countermeasures

(10 pts)

Supplier PPM <500


Trends down on 6 and 3 months rolling PPM with <10% imp = 11 pts

PPM with 0 imp = 10 pts

Suppliers 150–200 PPM Automatically get full 12 Points

Trends down on 6 and 3 months rolling CAL with >10% imp =

12 pts

Trends down on 6 and 3 months rolling CAL with <10% imp =

11 pts

CAL with 0 imp = 10 pts

Suppliers with 2–3 CAL automatically get full 12 Points

Contribution to PPM >.4% and PPM >500:

PPM .41–.5 = 5 pts

PPM .51–.6% = 4 pts

PPM .61–.8% = 3 pts

PPM .81–1% = 2 pts

PPM 1.01–1.5% = 1 pts

PPM>1.5% = 0 pts

Contribution to CAL >6 Occurrences

CAL 7 = 5 pts

CAL 8–10 = 4 pts

CAL 11–12 = 3 pts

CAL 13 = 2 pts

CAL 14–15 = 1 pts

CAL> 15 = 0 pts

Field Failures (FF) in the last 12 month with significant customer impact:

Field Failures with medium customer impact and support cooperation = 8 pts

Field Failures with high customer impact and support cooperation = 6 pts

Multiple part families with Field Failures from supplier = 4 pts

Fail Failures with medium customer impact and poor support cooperation = 2 pts

Field Failures with high impact on customer and poor support cooperation = 0 pts

Supplier PPM >500

PPM Increasing <5% = 8 pts




PPM Increasing >20% = 0 pts

PPM >1000 is automatically 0 pts

Supplier CAL >6 CAL

CAL Increasing <5% = 8 pts




CAL Increasing >20% = 0 pts

CAL>15 is automatically 0 pts

Contrib 10 pts 10 pts 14 pts 18 pts 18 pts

70 points of scoring for associated risk based on performance.


Note: These are guidelines—SDEs still need to use critical thought.

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QUALITY RISK SCORING

Supplier Capabilities

RiskProblem Solving

(8D)Perfect Launch

(PPAP/FPY)Process Control(Process FMEA)

Continuous Improvement(Focus Supplier)

Use of proper tools with all issue closure less than 30 days and no repeat issues

(9–12 Points)

Above 90% FPY on PPAP submissions and no issues in first 90 days

(5–6 Points)

Process FMEA present with active RPN reduction activities and robust control plans

(5–6 Points)

Not on focus supplier with good quality performance

(5–6 Points)

Use of proper tools with average closure less than 30 days with minimal repeat issues

(7–8 Points)

70–89% FPY on PPAP submissions with minor issues in first 90 days and prompt reaction

(4 Points)

Process FMEA present with active RPN reduction activities and robust control plans

(5–6 Points)

Quality trends indicate lack of continuous improvement

(3–4 Points)

Lack of use of proper tools with average closure greater than 30 days and numerous

repeats

(0–6 Points)

Below 70% FPY on PPAP submissions with poor reaction

(0–3 Points)

No FMEA or failure mitigation methods and/or poor process control

(0–3 Points)

On the focus supplier program due to performance or deteriorating quality levels

(0–2 Points)

Contrib 12 pts 6 pts 6 pts 6 pts

30 points of scoring for associated risk based on capability.


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PROCESS GOVERNANCE

Process Update

■ All Supplier Risk Rating to be updated every six months (Mid-Year [June–July]–End Year [December–January])

■ If it is deemed appropriate, a supplier review board should be scheduled for a rating review out of the scheduled update windows:

– Commodity manager should attend

– Quality representative for the supplier and requesting region should attend and present data justifying the change

– Regional Quality leader can attend as optional

■ SDEs should always practice judgment while applying the criteria

■ SDEs should collaborate with process partners to assess supplier competence

■ SDEs are responsible to define quality roadmaps by commodity based on the Risk Rating

■ Before asking for an unplanned update, the regional SDE should evaluate the following:

– Are we reacting to a special cause event (single data point)?

– Is the change in risk based sustainable improvement or confirmed performance degradation (3+ months)?

SDEs Responsibility


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THE CURRENT STATE OF SUPPLIER PERFORMANCE IMPROVEMENT

“Improve Suppliers” Importance Versus Maturity ScoreAverage Score

Quality executives recognize the importance of supplier improvement, but maturity lags.

■ Improve Suppliers: Practices used to ensure the suppliers improve their capabilities and performance over time.

Level 1 Level 2 Level 3 Level 4 Level 5

Quality reacts to supplier issues that disrupt operational processes with limited and targeted support to fix the immediate issue.

Quality offers unmetered support to critical suppliers with chronic poor performance.

Quality uses established relationship and performance criteria to identify suppliers who need improvement and helps them improve systems and processes.

Quality uses an established risk framework to prioritize suppliers requiring improvement on both operational and strategic activities.

Quality identifies select Tier 1 suppliers to collaboratively improve culture of quality and the quality of corporate management practices.

n = 24.Source: CEB Quality 2014 Functional Maturity Diagnostic.

Importance Maturity

5.0

4.0

3.0

2.0

1.0

0.0

3.35

2.31

Very Important

Project # xxxxxx



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OVERVIEW

Rolls-Royce plc operates in four global markets: civil aerospace, defense aerospace, marine, and energy. It is investing in technology and capability that can be exploited in each of these sectors to create a competitive range of products.The success of these products is demonstrated by the company’s rapid and substantial gains in market share during recent years. As a result, engine deliveries have grown and the company now has a total of 54,000 gas turbines in service worldwide. The investments in product, capability, and infrastructure to gain this market position create high barriers to entry.

GUIDING PRINCIPLES

■ To ensure supplier performance and improvement, the company must establish structure for performance measures, reporting, analysis, and issue resolution.

■ Standardizing language, information, processes, and roles is as important among internal parties as with suppliers.

COMPANY SNAPSHOT

Rolls-Royce plc

Industry: Aerospace, Power Systems, and Defense

Rolls-Royce has a broad customer base comprising more than 500 airlines, 4,000 corporate and utility aircraft and helicopter operators, 160 armed forces, and more than 2,000 marine customers, including 50 navies. The company has energy customers in nearly 120 countries. Rolls-Royce employs 40,000 people in more than 50 countries.

2011 Sales: £11 Billion

Employees: 40,000

Headquarters: London

SYSTEMATIC SUPPLIER PERFORMANCE MANAGEMENT

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SYSTEMATIC SUPPLIER PERFORMANCE MANAGEMENT

Practice Components

Rolls-Royce creates global standards for consistent assessment, management, and communication of supplier performance.

Potential Continuous

Improvement Roadblocks

Practice Components

Inconsistent/Unreliable Data

Standards

Performance Issues Not Addressed Adequately

Uncoordinated or Inefficient Measurement

Activity

Suppliers Lack Awareness of Performance

Standards

Component 1: Comprehensive Metric Dictionary

Easy-to-use metrics dictionary standardizes all aspects of performance assessment.

Component 3: “Three-in-One” Escalation Process

Systematic underperformance resolution process with escalation triggers involves/assigns appropriate skills and activities.

Component 2: Supplier Measurement Road Map

Process map sets out discrete tasks, owners, and data requirements.

Component 4: Supplier Training and Tools

Training sessions and online tools for suppliers foster awareness of performance requirements.

“We have developed cross-checks and methods to ensure that

our data is world class, enabling us to use this information to make important business decisions.”

Rick Wells Supplier Support Leader Rolls-Royce

Source: Rolls-Royce Holdings; CEB analysis.

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RIGOROUS PERFORMANCE IMPROVEMENTA systematic process formalizes issue resolution actions and triggers for escalating to higher levels as new capabilities are required.

Level 3:Fundamental Redesign

Level 2:Improve Overall

Performance

Level 1:Make Immediate Improvements

Level 0:Restore the Status Quo

■ Purpose: Verify adherence to established process and product specifications.

■ Owner: Local Area Manager

■ Duration: Two weeks

■ Purpose: Analyze process, product, or system to identify root cause.

■ Owner: Specialist

■ Duration: Three weeks

■ Purpose: Deploy cross-functional team to address complex/broad problem.

■ Owner: Local Area Manager Plus Specialist

■ Duration: Five weeks

■ Purpose: Involve senior management to determine redesign or supplier change.

■ Owner: BU Director, Specialist, and Local Area Manager

■ Duration: Indefinite

Trigger: Fundamental redesign may be required to resolve issue.

Trigger: Cross-functional team is needed to resolve root cause.

Trigger: Problem is still evident after status quo restored.

3

2

1


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ACTIONABLE CONTINUOUS IMPROVEMENT PLAN

Escalation Gantt ChartIllustrative

“Time-boxed” process steps promote thoroughness while maintaining progress.

Tasks and Milestones Owner Mandatory Support Status February March April May

3 10 17 24 3 10 17 24 1 7 14 21 28 3

Level 0: Restore the Status QuoVerify adherence to established process and product specifications.

Problem Definition Rolls-Royce Supplier Completed

Containment Action Supplier Completed

Customer Protection Supplier Local Area Manager Completed

Process Adherence Review Supplier Local Area Manager Completed

Specification Conformity Review

Supplier Completed

Adherence/Conformity Results Analysis

Supplier Completed

Resolution Plan Definition/Development

Supplier Completed

Level 1: Make Immediate ImprovementsAnalyze process, product, or system to identify root cause.

Root-Cause Analysis Supplier Specialist Completed

Customer Protection Review

Supplier Rolls-Royce Completed

Improvement Plan Implementation

Supplier Local Area Manager Completed

Progress Monitoring Supplier Completed

Level 2: Improve Overall PerformanceDeploy cross-functional team to address complex/broad problem.

Integrated Team Resources Identification and Formation

Supplier Specialist, Local Area Manager

Completed

Additional Root-Cause Analysis

Supplier Specialist Completed

Customer Protection Review

Supplier Specialist Completed

Process Improvement Plan Definition and Implementation

Supplier Specialist, Local Area Manager

Completed

Progress Monitoring Supplier Local Area Manager Completed

Level 3: Fundamental RedesignInvolve senior management to determine redesign or supplier change.

Level 2 Business Care Consideration

Supplier Three-in-One Receiver, Specialist, Local Area Manager, BU Director

In Progress

Redesign Decision-Making Process

Supplier, Specialist, Local Area Manager, BU Director, three-in-one Receiver

Not Started

Hard timescales maintain process discipline and discourage premature closure.


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CONTINUOUS IMPROVEMENT PLAN SAMPLE TEMPLATE GUIDE

Supplier: __________________

Date: __________________

Purpose: __________________

Priority Metric KPIs Targeted

Current Score

Target Score

Improvement Initiatives

Action Step(s)

Owner Target Date

Date Completed

Status/Notes

1

2

3

4

5


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SESSION TAKEAWAYS

CEB Resources and Recommended Next Steps

Assess Your Supplier Quality Management Maturity ■ Option 1: Functional Maturity Diagnostic (Full-Functional Assessment) ■ Option 2: Supplier Quality Management Maturity Model (Quick Self-Check)

Build a Standard Supplier ScorecardScorecard Builder (Library of Best-in-Class KPIs)

Create a Consistent Continuous Improvement PlanContinuous Improvement Plan Template

Participate in the Supplier Quality Management Benchmarking Effort in the Early Fall

1. Align scorecard metrics with elements business partners care about (i.e., metrics beyond quality).

2. Create standard global scorecards to assess supplier performance across all elements of the relationship.

3. Use scorecard results to construct actionable continuous improvement plans that establish joint accountability.

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QUESTION AND ANSWER SESSION

Logistics ■ Press “*1” on your phone to ask a question. ■ Written questions can be submitted directly into the web platform.

For more information and to access additional resources please visit www.ceb.quality.executiveboard.com or contact [email protected].

http://www.ceb.quality.executiveboard.com

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Manage Supplier Risk - Drive Superior Supplier Quality Outcomes (CEB Webinar)

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